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But not every company can easily bootstrap. And of those that can, much of the time it's a lot faster if you take some money upfront. Nothing wrong with either
by staticassertion 7y ago
But not every company can easily bootstrap. And of those that can, much of the time it's a lot faster if you take some money upfront.
Nothing wrong with either approach imo, but the ridiculous valuations are a separate and, yes, exhausting problem. I'm not sure why people even seek insane valuations - maybe VC push them into it or something? I don't know.
- Lukeas14 7y agoI'm not sure why people even seek insane valuations - maybe VC push them into it or something? I don't know. Because the founders get to keep more ownership of their company. If I take an investment of $100 million at a $1 billion valuation I own 90%. If the valuation is only $500 million I only own 80%. Why the company needs such a huge investment is a fair question but the insane valuation makes sense.
- staticassertion 7y ago> Because the founders get to keep more ownership of their company. At first that would be the case, but as the valuation drops (and becomes more realistic) wouldn't the founder lose shares, and the VC would gain more control due to non diluting shares?
- smartbettor 7y agoNo. but the investors would remove the founder.